Advocacy Flow: a structured dialogue with Government
In 2014 AmCham Hungary decided to revisit the way it operates in order to:
- communicate to members and all other stakeholders its vision, mission and strategies
- channel the opinion of members on a planned, structured manner to the government
- create the platforms for our members to contribute and
- establish regular, well-planned and documented discussion with the decision makers
As a first step in fall 2014 AmCham Hungary reconfirmed its mission: “To be the most effective representative of the business community in Hungary, while promoting the global competitiveness of the country“, and defined the World Economic Forum Competitiveness Report to be the measurement in reviewing progress made in this area.
Through deep analyses of the 12 Pillars of the Report, AmCham Hungary defined those 4 areas where AmCham can impact on improving the competitiveness of the country, being: Investment, Talent, Innovation, Healthy Nation. A strategic document, called the “Policy Agenda 2015-2017” was compiled to detail the challenges, the recommendations and commitments in these 4 respective areas.
At the same time Policy Task Forces (PTF) were set up and annual flagship events and forums were launched for each focus area to provide platform for our members to join and input into the advocacy topics.
In June 2017 AmCham Hungary issued its second Policy Agenda 2017-2020 with the following 4 focus areas:
As a result of this more organized and structured advocacy flow, our activities are easier to plan and to explain to key stakeholders. Our members have a better understanding of our next steps and where they can tap in to advocacy topics. Our government partners also welcome the structure, as they can now count on our recommendations, making it easier to plan the discussions and prepare ahead.
The AmCham way of working
AmCham’s advocacy activity is based on an annual cycle of consultations, event highlights and policy publications. Policy Task Forces (PTFs) and Committees provide the input for the advocacy activity throughout the year through their projects and events. The advocacy recommendations that come out from these activities are being discussed and further developed at the regularly organized State Secretary Roundtables, Business Forums, the meetings of the Competitiveness Council (established by the Government in 2017) and also at AmCham’s annual flagship events: the Business Meets Government Summits, the Competitive Education Conferences and the Business Meets Universities workshops. A recommendation package titled ‘Cooperation for a more competitive Hungary' is compiled and shared with the Government each year, the 2017 package was sent to the Government in December 2016 and has been discussed throughout 2017.
As the cornerstone of our advocacy work and in accordance with our vision, AmCham launched its second Policy Agenda in June 2017.
AmCham Hungary published its first Policy Agenda in June 2015, after a series of stakeholder meetings. The first Policy Agenda was based on the pillars of the Global Competitiveness Report (GCR), focusing on those areas most critical to be improved, and where the biggest impact could be made. The second edition also closely follows the GCR findings; however, it also incorporates many of the learnings of the advocacy work of the past two years. These are also manifested in the dialogue with the government, and in our events, programs and publications including the establishment of the Digitalization Policy Task Force. The paper serves as a firm backbone to our future advocacy work and provides a clear indication of our priorities.
The Policy Agenda defines how the AmCham community can improve Hungary’s competitiveness, what is needed to make Hungary more attractive for international investors, and also what is required from the regulatory environment to achieve our common goals. The publication will continue to be a strategic paper, an outline and guidance, not a tactical playbook.
The four focus areas are:
In order to put a system in place to support these topics we created the so-called Policy Task Forces. These professional groups – incorporating the brainpower of our expert members – worked out the Policy Agenda in close cooperation with the AmCham Board of Directors. Based on the advocacy roadmap outlined in the Policy Agenda, we have a regular, structured and dynamic dialogue with the Hungarian government, aiming to improve Hungary’s competitiveness.
This is a living document... Please talk to us, share your ideas for improvement, challenge us and, most of all, we invite you to actively contribute by joining a Policy Task Force!
‘Cooperation for a more competitive Hungary 2017’ recommendation package
In December 2016, AmCham along with its Board Members and partners completed and sent AmCham’s ‘Cooperation for a More Competitive Hungary 2017’ recommendation package to Prime Minister Viktor Orbán and his cabinet. Highlights included creating a more balanced industrial portfolio, enabling Hungary to climb up the value chain, the introduction of a new R&D grant scheme to attract new R&D centers and stimulate the expansion of the existing setups of larger corporations, the continues cutting of red tape and the need for more cloud-based e-government solutions.
Minister of Foreign Affairs and Trade Péter Szijjártó was appointed by Prime Minister Viktor Orbán to discuss these recommendations in detail with AmCham. Minister Szijjártó and the AmCham delegation met in March 2017, where Minister Szijjártó reflected on AmCham’s proposals and asked for further elaboration of certain recommendations, which were developed and sent to him in April 2017. The dialogue about our recommendations also continued at the AmCham-Ministry for National Economy (NGM) working group meetings with State Secretary István Lepsényi and representatives of the relevant departments.
Before the our new way of working was established, AmCham's flagship lobbying vehicles were its position briefs. These succinct proposals were submitted to the Hungarian government on a regular basis and conveyed the views of the AmCham membership on a specific topic. Position Briefs were followed-up with round table discussions with the experts that have contributed to the brief and relevant government representatives. For further information, please click here.
Success stories and policy progress in 2017
The ‘Cooperation for a more competitive Hungary 2017’ recommendation package was issued in December 2016 and AmCham is proud to report that we have made considerable progress in many areas since then. As a result of high level and expert level consultations, we recognize several new policy measures and government initiatives as in line with our recommendations. The following list provides an overview of these measures:
- Reduction of Corporate Income Tax to 9% was a game changer for Hungary.
- Gradual, continued and predictable reduction of the labour tax burden.
- Significant and favorable changes were introduced in the non-refundable cash incentive system with the purpose of supporting R&D activities and technology-intensive investments in Hungary.
- We see a very positive trend in making Hungary an attractive location for R&D centers and value added investments.
- Government strategy has been developed to enhance Industry 4.0 related innovation and the cooperation among large cooperations and startups. A new accreditation framework and corresponding incubation methodology and qualification system have been worked out.
- At the joint request of AmCham, DUIHK and JVSZ, the Ministry for National Economy assured the industry that the planned measures implying real-time online data connection between companies and the National Tax and Customs Administration of Hungary when issuing an invoice will become effective only after a test period, and companies would have enough time for the preparations.
- The government’s strategic economic development plan (Irinyi Plan) considers the electronic manufacturing industry as a strategic industry and increase focus is paid to sector specific development plans.
- AmCham’s President Dr. Farkas Bársony was invited to the National Competitiveness Council established by the government and Minister for National Economy Mihály Varga in 2017.
- The government’s strategic economic development plan (the Irinyi Plan) considers the electronic manufacturing industry as a strategic industry and increased focus is paid to sector specific development plans.
- Increased support for dual education in higher-level education.
- Increased focus on raising the effeciency of language learning in public education.
- Introduction of a Career Orientation Day in public education.
- Industry specific Sector Skill Councils have been established so that industry players can provide regular and structured input for a more competitive and uptodate (vocational) training system and curricula.
- Planned legislation of the modification of the Law on Labor Safety, impacting the regulatory framework of remote work, reflects AmCham’s input.
- Following expert level consultation with AmCham and the Ministry of Justice on the draft legislation of GDPR, a working group was established by the Ministry to provide forum for inter-ministerial consultations and to help develope furter legislative pieces in different areas of law within the implementation process of GDPR in Hungary.
- Simplified licensing procedure threshold lifted from 5 to 10% on employment on non-EU (third country) residents.
AmCham is dedicated to support implementation of the aforementioned new measures and is also committed to continue dialogue with our partners about those topics where consensus has been not yet been reached. AmCham would like to thank members for sharing their expertise and for their contribution toward developing policy recommendations.
AmCham Hungary advocacy activities in 2017 were guided by our first and second Policy Agenda and the ‘Cooperation for a More Competitive Hungary 2017’ recommendation package. AmCham efforts in advocacy rely on following pillars:
- strong membership
- robust advocacy work of the Investment, Talent, Innovation and Digitalization Policy Task Forces, and Regulatory Committee
structured partnership with key stakeholders.
Ministry for National Economy (NGM)
Strong cooperation and regular consultation between AmCham and the Ministry for National Economy have taken place. A number of meetings and events were organized with the Ministry: the Strategic Working Group Meetings in March, July and October; the Third Business Meets Government Summit in September, the Third Competitive Education Conference and State Secretary Meetings with Gáborné Pölöskei Deputy State Secretary for vocational training and adult education. AmCham participated in several expert level meetings on various topics, including: the electronic manufacturing industry strategy, the Industry 4.0 Strategy, the implementation of the regulation of R&D qualification of project groups. AmCham also supported the Ministry’s activities by contributing to the organization of its events and projects, for example the Automotive Hungary, the EURES online job fair, and the establishment of the Sector Skill Councils.
Ministry of Foreign Affairs and Trade (‘KKM’) & Hungarian Investment Promotion Agency (‘HIPA')
Cooperation is based on the Strategic Agreement signed in 2015. Joint events and projects include: Business Meets Government summit series and the Competitive Education Conference series. HIPA representatives actively contribute to the work of AmCham Policy Task Forces and Committees. AmCham supports the activities of KKM and HIPA, participates in the official visits organized by the Ministry and the Agency. In 2017, AmCham participated in business consultations with representatives of the Site Selectors Guild (SSG), as a professional partner of HIPA to jointly present Hungary’s potentials as an investment location.
Ministry of Human Capacities (EMMI)
EMMI once again partnered us for our Competitive Education Conference event in 2017 and delegated Deputy State Secretary Boglárka Illés and Deputy State Secretary Zoltán Maruzsa to open the conference and attend a roundtable, respectively. Cooperation and consultation took place at a number of other meetings, including a a state Secretary Roundtable on vocational training and education in April. An expert level consultation took place about the possibilities of extending summer internship programs in Hungary for Hungarian students studying abroad.
Ministry of Justice (IM)
AmCham has a well-established, formal cooperation framework with the Ministry of Justice based on the Strategic Partnership Agreement that was first signed in 2011, then re-confirmed in 2014. In February, Deputy State Secretary Zoltán Nemessányi participated at AmCham’s extraordinary Committee meeting to present and discuss the Ministry’s legislative agenda for 2017. During the year, AmCham’s Regulatory Committee has sent its professional input to the Ministry in a number of legislative areas, and several professional consultations took place between the Regulatory Committee members and ministry experts, including the AmCham position on the implementing GDPR legislation.
A National Competitiveness Council was established by the Government and Minister Mihály Varga invited AmCham President Farkas Bársony to join. Council members include the minister, the President of HIPA, President of the German-Hungarian Chamber of Industry and Commerce, and the President of the Hungarian Chamber of Commerce. President Bársony channels AmCham’s recommendations into the work of the Council. Its meetings are now part of the chamber’s annual cycle of ongoing consultation with decision makers and a new opportunity to conduct our advocacy activity and contribute to the improvement of Hungary’s competitiveness.
Development Office (NKFIH)
In 2017, regular consultation took place between AmCham’s Innovation PTF and the NKFIH on R&D&I related issues. At the third “Business Meets Government Summit” in September, President József Pálinkás represented NKFIH in the public and closed-door roundtable discussions and discussed R&D&I related recommendations with AmCham representatives.
Hungarian Association Of CustomsAffairs (Magyar Vámszövetség)
In April 2016, AmCham and the Hungarian Association of Customs Affairs signed a cooperation agreement in order to facilitate consultation and professional collaboration on international trade regulations and custom affairs. In early 2017, a joint survey was conducted on industry experiences with Hungarian export control and authorization procedure for dual use items. Joint efforts are coordinated at the Investment Policy Task Force.
U.S.-Hungary Business Council (USHBC)
AmCham cooperates with the USHBC, which is a platform for dialogue between U.S.-based corporate executives and the top government leaders responsible for the U.S.-Hungary bilateral relationship.Following last year’s successful visit, in June 2017 representatives of AmCham and USHBC met the government’s leadership to discuss economic ties between Hungary and the United States of America.
US Embassy, Budapest
AmCham cooperates with the U.S. Embassy in Budapest by jointly organizing high-level events. Patron Members of AmCham met Chargé d’Affaires David J. Kostelancik in April for a Patron dinner. AmCham also hosted a Business Forum with Chargé d’Affaires Kostelancik and Dr. László Szabó, then the delegate Ambassador of Hungary to the United States, which was their first official address together. Before their podium discussion, AmCham Patron members had an exlusive meeting with Dr. Szabó. During the AmCham General Assembly in 2016, U.S. Ambassador Colleen Bell and Hungarian Ambassador Réka Szemerkényi were awarded the Dr. Iván Völgyes Award, recognizing individuals who made significant contributions to the work of AmCham and the development of U.S.-Hungarian business relations.
Domestic and International Partnerships
AmCham Hungary's extensive network means that it not only has the backing of it members but also other organizations in Hungary and around the world. In Hungary, AmCham has developed close ties with the Joint Venture Association, German Chamber of Commerce and the Hungarian Venture Capital Association. We also work closely with a number of universities and high schools across Hungary in the framework of our educational programs.
Internationally, AmCham is a member of AmChams in Europe, an organization consisting of 23 Chambers, representing over 14,000 companies and over $300 billion in investment in Europe and the USA. In addition, AmCham is also a member of the U.S. Chamber of Commerce in the United States.